Comments (21)

Feb 12, 2012

yes. the cost of insuring a guy with black lung is ridiculous.

Feb 12, 2012

Not as much as Real Estate or FIG.

Edit: nevermind, listen to Valk

Feb 12, 2012

Although it varies, any group where you'll gain a specialized/esoteric skillset will pigeonhole you. This includes mining. Knowing how to model head grades and production declines or in-situ vs heap leaching processes etc. isn't very applicable to other sectors, and generalist PE firms rarely invest in the sector.

On the flip side, mining deal-flow will always be there and mining bankers can do very well for themselves. Seems like the space is gonna heat up this year, especially if the Glencore-Xstrata deal goes through (Will be the largest mining deal in history, and could potentially be the largest deal this year globally).

Feb 14, 2012

Not so if M&M is something you truly like to do!

Feb 14, 2012

other ibanks, maybe one of your mining companies?

that's just a guess.

Feb 14, 2012

first reserve is a m&m focused pe fund....

but i think exit options are abit limited for m&m analysts

Feb 14, 2012

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Feb 14, 2012

You could get a cushy job working as an in-house principal investments/acquisitions analyst at something like Rio Tinto/Xstrata/BHP Billiton. You could move to a hedge fund (either a metals fund like Red Kite or a long/short equity fund that has a metals/mining component). You might be able to move to an asset management firm and become a junior PM within their metals/mining groups.

You're unlikely to have many VC opportunities, and I can't speak intelligently on the PE space within the mining sector, but I doubt it's very large.

Feb 14, 2012

Thanks for the good insight, brotherbear.

How would one get the corporate development-like opportunities that you mentioned -- headhunters, networking?

I'm not interested in VC, but PE is an option I'm also interested in.

Feb 14, 2012

In the resource sector PE and VC refer to the same thing (merchant banking).

You can't do an LBO of mining or oil & gas companies (high capex), so "private equity" in the standard definition is non existent. The "private equity" firms in the space are actually venture capital (providing early stage capital to exploration companies). Too bad this term got hijacked by tech companies in the 90's.

If you're in Canada, you could contact Vlaad. He has occasionally has some business development opportunities in the sector.

Feb 14, 2012

Good point raised, yung_gekko. In that space, I would think companies like Endeavour Financial come to mind. Are there any other companies like Endeavour in Canada - especially those that have historically placed IB analysts?

Keep the ideas flowing - thanks a lot so far.

Feb 14, 2012

There actually are a few players in the PE space who do resources deals (Resource Land Holdings to name one). Many of the players in the energy space more broadly do mining deals (coal).

Their are also a number of MLPs that own finite life mines of various types. I have known people who went over to them as well.

As a fairly specialized space, basically your options are, Corp Dev, PE/VC in a related firm, or continue with IB. Anyone you deal with as a client or competitor is a likely exit opp. So, if you do a deal where ETP is looking at acquiring some of ANR's assets, those are two exit opps.

Feb 14, 2012

Thanks a lot for the insight. PowerMonkey.

I'm interested in staying in Canada.

Appreciate the help so far -- anyone else, especially with a knowledge of Canadian exit opps?

Feb 14, 2012

How long were you in m&a for? Might not be entirely impossible on pe if your still interested

Feb 14, 2012

good amount of PE funds that invest in natural resources and mining, including Apollo

Sep 20, 2019

Anyone on this site currently working in the sector? Curious about the sources of optimism at the moment given some pretty heavy headwinds (i.e. is there a state of the world in which one might make an upside bet by pivoting from M&A to M&M)?

Sep 20, 2019
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